224.—(1) Notwithstanding sections 32 and 60 of the Principal Act a company may, subject to the provisions of this section, acquire and hold shares in a company which is its holding company.

(2) The acquisition and holding by a subsidiary under subsection (1) of shares in its holding company shall be subject to the following conditions:

(a) The consideration for the acquisition of such shares shall be provided for out of the profits of the subsidiary available for distribution.

(b) Upon the acquisition of such shares and for so long as the shares are held by the subsidiary—

(i) the profits of the subsidiary available for distribution shall for all purposes be restricted by a sum equal to the total cost of the shares acquired;

(ii) the shares shall, for the purposes of the consolidated accounts prepared by the holding company in accordance with sections 150 to 152 of the Principal Act, be treated in the same manner as is required in respect of shares held as treasury shares under section 43A of the Act of 1983 (inserted by section 232
(c) of this Act); and

(iii) the subsidiary shall not exercise any voting rights in respect of the shares and any purported exercise of those rights shall be void.

(3) A contract for the acquisition (whether by allotment or transfer) by a subsidiary of shares in its holding company shall not be entered into without being authorised in advance both by the subsidiary and its holding company and the provisions of
sections 212 to 217
shall apply, with the necessary modifications, to the granting, variation, revocation and release of such authority.

(4) For the purposes of this section, a subsidiary's profits available for distribution shall not include the profits attributable to any shares in the subsidiary for the time being held by the subsidiary's holding company so far as they are profits for the period before the date on or from which the shares were acquired by the holding company.

(5) This section shall not apply to shares held by a subsidiary in its holding company in the circumstances permitted by section 32 of the Principal Act.

(6) This section, except subsection (2) (b) (iii), shall not apply to shares subscribed for, purchased or held by a subsidiary in its holding company pursuant to section 9 (1) of the Insurance Act, 1990.